Jan 15, 2018 (LBO) – Sri Lanka’s plans to increase the contribution made by smaller-scale businesses to exports and lift foreign direct investment (FDI) in 2018 were both topics of conversation at a meeting held recently between Eran Wickramaratne, state minister of finance, and a team from Oxford Business Group (OBG).
During the talks, Wickramaratne said the budget for 2018 included measures aimed at bolstering support for small and medium-sized enterprises (SMEs) as part of broader plans to hand them a bigger role in Sri Lanka’s economic development.
“The 2018 budget focuses on encouraging investments in exports. However, at the moment, a few big companies account for 90% of all earnings from international sales,” he told OBG’s team. “It is vital, therefore, to strengthen SMEs in exports so that earnings are dispersed and the risks from exposure are reduced.”
Wickramaratne added that the budget was drawn up with the aim of playing to the country’s strengths. “Sri Lanka has a favourable geographical location, which allows it to act as a logistics hub between two huge markets, namely China and India,” he said. “It also has a well-educated human resource base, despite its small size.”
On the subject of FDI, Wickramaratne acknowledged that While FDI had fallen below expectation in the last couple of years we expect FDI to nearly double in 2017 over 2016″
Attracting FDI for key sectors, such as ICT, tourism and mining, is seen as pivotal in Sri Lanka’s efforts to make the transition to knowledge-based economy. “I expect FDI in 2018 to register increased growth, taking account of the EU’s generalised scheme of preferences plus (GSP+), the new budget and planned free trade agreements,” the minister said.
OBG’s representatives met Wickramaratne with work under way on The Report: Sri Lanka 2018, the global research and consultancy firm’s forthcoming publication on the country’s economy.
The Report: Sri Lanka 2018 will be a vital guide to the many facets of the country, including its macroeconomics, infrastructure, banking and other sectoral developments. The publication will contain a detailed, sector-by-sector guide for investors, alongside contributions from leading personalities. It will be available in print and online.